WASHINGTON–CUNA told the Department of Defense it has “grave concerns” regarding the effective date of the DoD’s recently amended Military Lending Act (MLA) regulation. In a comment letter the trade group noted it has been “very vocal” about its concerns, “particularly regarding the increased costs and unintended consequences that are likely to result from an overly broad rule.
“We remain troubled that the regulation may ultimately, and unintentionally, have a negative impact on the delivery of high quality, reasonably priced financial products and services to our troops and their families,” CUNA wrote. ‘Credit union products and services are beneficial alternatives to those offered by predatory lenders, particularly those that exploit military personnel.”
CUNA noted it has “worked extensively” with DoD and Consumer Financial Protection Bureau (CFPB) staff over the past six months to make both aware of specific questions and issues credit unions need answers to and clarification on in order to comply with the regulation.
“Based on our review of the guidance, it appears to provide some helpful information regarding certain provisions of the regulation,” CUNA wrote. “However, there are a number of areas and issues on which credit unions need clarification that were not addressed in the guidance, such as the definition of the term “ancillary product,” which is critical to accurately determining the Military APR. In fact, we note that the DoD’s guidance addresses fully only two, and arguably partially only an additional two of the nine total issues that CUNA submitted to the DoD, previously mentioned”
The full letter can be found in CUToday.info’s The Gov here.